|Poppies--Courtesy of John Beniston|
India's top drugmaker, Sun Pharmaceutical Industries, has agreed to buy GlaxoSmithKline's ($GSK) opiates business in Australia, placing it as one of three owners that control the crop and production in Tasmania that is the world's largest legal supplier of pharmaceutical-grade opiates for painkillers.
Sun said in a March 3 press statement that the deal was made to strengthen its pain management division by gaining access to analgesics made from raw materials found in opium poppy plants, and two manufacturing sites in the states of Tasmania and Victoria.
Glaxo currently supplies a quarter of the world's medicinal opiate needs from poppies grown by farmers in Tasmania, according to its website, with the Australian business earning A$89 million ($69.63 million) in revenues in 2013.
In addition to GSK, Johnson & Johnson's ($JNJ) unit Tasmanian Alkaloids, and privately held TPI Enterprises, control production in Tasmania.
The demand for opiates has grown, leading firms to consider synthetic production.
Financial terms were not disclosed of the deal expected to close in August, but it comes as the market for opioids has seen fast-paced demand.
Tasmania produces about 85% of the global supply of thebaine, the opium poppy extract used to make Oxycontin and other similar drugs. It produces all of the oripavine in the world, used to make treatments for heroin overdoses. It produces 25% of the world supply of morphine and codeine, which continue to be used widely outside of the U.S.
Turkey and India also grow and manufacture opium base products used by drug companies under the United Nations Single Convention on Narcotic Drugs and other international drug treaties for firms such as Mallinckrodt ($MNK), Noramco, Abbott Laboratories ($ABT), Purdue Pharma, and Cody Laboratories in the United States.
As well, Sanofi-Aventis produces it in France; Shionogi Pharmaceutical in Japan; and Macfarlan Smith in the United Kingdom.
- here's the release (PDF)